Saudi Arabia is one of the fastest-growing economies in the Middle East. Thanks to Vision 2030, the Kingdom is opening up more opportunities for foreign investors and entrepreneurs. Whether you’re a local citizen or a foreign investor, business setup in Saudi Arabia can be a great opportunity. But to do it right, you need to follow the proper steps and get support from a law firm in Saudi Arabia.
This guide will walk you through the process of starting a business in Saudi Arabia in 2025.
Step 1: Decide Your Business Type
First, you need to choose the type of business you want to start. The most common types are:
- Sole Proprietorship
- Limited Liability Company (LLC)
- Joint Stock Company
- Branch Office of a Foreign Company
Each type of company incorporation has its own rules and benefits. For example, an LLC is popular because it limits your personal liability and allows foreign ownership. On the other hand, a branch office lets a foreign company operate directly in Saudi Arabia, but only in approved sectors.
Step 2: Choose Your Business Activity
Saudi Arabia has a list of approved business activities. This includes sectors like retail and wholesale, construction, information technology, health and wellness, tourism and hospitality, and more.
Before you start, check if your business activity is allowed. Some industries may need special licenses or local partnerships, especially for foreign investors.
Step 3: Reserve a Company Name
Once you’ve picked your business activity and structure, you’ll need a company name. You can reserve your business name through the Ministry of Commerce (MoC) website.
The name should be unique and not already in use, comply with Saudi naming rules, and not be misleading or offensive. If you’re setting up a branch of a foreign company, you can use the parent company’s name with approval.
Step 4: Get Initial Approval
The next step is to apply for initial approval from the Ministry of Commerce (MoC). This approval confirms that your business can operate under Saudi law. You’ll need to submit your proposed company name, business activity details, identification documents, and company structure information. Foreign investors must also get approval from MISA (Ministry of Investment of Saudi Arabia) before proceeding.
Step 5: Draft and Notarize the Articles of Association
The Articles of Association (AoA) is a legal document that defines how your business will operate. It includes the company name and address, names of shareholders or partners, capital amount, and profit-sharing rules. This document must be notarized by a notary public, either physically or through the online Qiwa platform, depending on your business type.
Step 6: Register with the Ministry of Commerce
After notarizing your AoA, you must register your company with the Ministry of Commerce (MoC). This will make your business legal and give you a commercial registration (CR) number.
You’ll also need to pay the registration fees. The cost depends on your company size and type of business activity.
Step 7: Register with Other Government Authorities
Once you receive your commercial registration, you need to register your business with a few more departments:
ZATCA (Zakat, Tax and Customs Authority): For tax registration
GOSI (General Organization for Social Insurance): If you plan to hire employees
Chamber of Commerce: For membership certification
As per the lawyers specializing in companies law in Saudi Arabia, this step is important to stay compliant with Saudi laws and avoid penalties.
Step 8: Open a Business Bank Account
With your business officially registered, you can now open a bank account. You will need a copy of your Commercial Registration, ID of the company owner or manager, company stamp, and AoA. Saudi Arabia has many banks that offer business banking services, such as Al Rajhi Bank, NCB, Riyad Bank, and others.
Step 9: Get Licenses and Permits
Depending on your business activity, you may need specific licenses. For example:
- A construction company needs a construction license
- A restaurant needs a food safety and municipality license
- A medical clinic requires health authority approval
These can be obtained from different ministries such as the Ministry of Municipality and Rural Affairs, Ministry of Health, or Tourism Authority, depending on your sector.
Step 10: Hire Employees and Start Operations
Now you’re ready to hire staff and begin operations. You’ll need employment contracts registered in the Qiwa platform with the assistance of lawyers specializing in commercial registration in Saudi Arabia, work visas for foreign employees through the Muqeem or Absher platform, and labor law compliance, including minimum wages, insurance, and benefits. Once you complete these steps, your business is officially ready to operate in Saudi Arabia.
Why Saudi Arabia is a Great Place to Do Business in 2025
Saudi Arabia is rapidly transforming its economy with Vision 2030 as it offers:
- A growing population with high spending power
- New investment laws allowing 100% foreign ownership in many sectors
- Improved digital services for faster business setup
- Special economic zones are newly adopted by the government to enhance the Kingdom’s economic strategy and to attract international companies by offering a few special aids.
Whether you’re in tech, health, real estate, or hospitality, Saudi Arabia provides a wide range of opportunities.
How Can SB Saudi Lawyers Help You With Seamless Business Setup in Saudi Arabia?
Setting up a business or company formation in Saudi Arabia involves many legal steps, and getting them right from the start is key to avoiding delays or compliance issues. This is where SB Saudi Lawyers come in.
With years of experience in Saudi corporate law, our legal experts offer complete support for local and international investors. From company registration to licensing, we guide you through every part of the process. We help you draft all legal documents, communicate with government agencies, and ensure your business follows Saudi laws at every stage.
At SB Saudi Lawyers, we help you beyond starting your business as we help you build it. Our services include:
- Legal consultation and feasibility analysis
- Assistance with MISA approvals and foreign investment licenses
- Drafting and notarizing Articles of Association
- Commercial registration and government filing
- Ongoing legal support as your business grows
Let us be your trusted legal partner in the kingdom. Contact SB Saudi Lawyers today to take the first step toward business success in Saudi Arabia.
